Greenlaw v. Aroostook County Patrons' Mut. Fire Ins. Co.

• Decision Date: 14 December 1918
• Citation: 105 A. 116,117 Me. 514
• Parties: GREENLAW v. AROOSTOOK COUNTY PATRONS' MUT. FIRE INS. CO.
• Court: Maine Supreme Court

105 A. 116

117 Me. 514

GREENLAW

v. AROOSTOOK COUNTY PATRONS' MUT. FIRE INS. CO.

Supreme Judicial Court of Maine.

Dec. 14, 1918.

Report from Supreme Judicial Court, Aroostook County, at Law.

Action by A. Raymond Greenlaw against the Aroostook County Patrons' Mutual Fire Insurance Company, to recover on insurance policies. On report from Supreme Judicial Court. Judgment for plaintiff.

Argued before CORNISH, C. J., and SPEAR, HANSON, PHILBROOK, DUNN, and MORRILL, JJ.

Doherty & Tompkins, of Houlton, for plaintiff.

W. R. Roix, of Presque Isle, and Shaw & Thornton, of Houlton, for defendant.

DUNN, J. As its name suggests, and the record of this case evinces, the Aroostook County Patrons' Mutual Fire Insurance Company is a domestic mutual fire insurance company. In other words, it is an aggregation of persons, endowed by the state of Maine with the attributes of corporate existence, and in that manner providing a mutual basis method, by which the associated individuals help to bear the burden of pecuniary loss incident to the destruction, by the happening of the peril of fire, of the property of one of their number. Fire insurance thus conducted means that if, during a prescribed period of time, any of the associated persons shall suffer loss by the accident of fire, the corporation of which they are members will indemnify him, having reference to the actual value of his insured property when it was destroyed, to an amount not exceeding the sum of money specified in an executory contract called a policy. Every person who takes insurance in such a company is both an insurer and Insured. He insures not only his own property, but he helps to insure the property of all the other members, during the term of his own membership in the mutual system corporation; that is to say, during the term of his policy. Rev. St. c. 53, § 35. He proportionately contributes, in the first instance by an assessable premium note (Rev. St. c. 53, § 36), to the assets of the company. Out of the assets, he is entitled to indemnification, within and as contemplated by the terms of his policy.

Acceptance by a mutual fire insurance company of an application for insurance makes the insured a member of the company. Carleton v. Insurance Co., 109 Me. 79, 82 Atl. 649, 39 L. R. A. (N. S.) 951. In that way, on September 11, 1912, the plaintiff became a member of the defendant corporation. It thereupon issued and delivered to him a policy of insurance against loss or damage by fire, to the sum total of $3,000, for the period of five years then next to ensue, in varying amounts, on his dwelling house, ell, woodhouse, barn, and shed, and on hay and grain "while contained in said buildings" in Presque Isle. For convenience, that policy will be referred to herein as the 'first." In form it was of statutory standard. It fittingly carried what is known as a "rider." That rider, which was printed as a part of the slip or sheet of paper that contained the blank form on which the insurance was distributed and described, sanctioned and concerned the use about the insured premises of gasoline and kerosene engines and electric motors; related to the placing of supply and storage tanks thereat; and inhibited the use of stovepipe projecting through the roof or wall of any of the insured buildings, "or any building within one hundred feet." It contained no other provision limiting the company's liability.

On June 19, 1914, somewhat less than two years later, plaintiff applied to defendant company for another policy of insurance; this time for $800 on his potato house, and for $500 on his farming tools. Policy issued for a five-year term, restricting insurance on farming tools to "while contained in his farm buildings." This policy, which will be styled the "second," also is of standard form, and attached has rider counterpart of that on the first.

By application bearing date of August 30, 1917, in anticipation of its expiration on September 11th, the plaintiff applied for renewal of the first policy. His application was made on a blank which the company had prepared to be used for such purpose. Excepting as to the term for which insurance was desired, and as to the date thereof, this application and that submitted for the first policy were practically identical. There was nothing about either even remotely to give an inkling of the defense endeavored to be made in this case. Defendant's directors, at a meeting held on the day that the first policy expired, accepted the application for renewal. But a new policy was not made up until two days later, when it was antedated so as to run from the expiration of that renewed. Late in the day on which the policy issued, it was mailed by the defendant to the plaintiff in the same town. The plaintiffs mail was supplied by a carrier route which started from a nearby town. For some reason, the policy did not come to the plaintiff, in the mail, until after noontime on September 15th, four days after its date, and two days later than the date of the day on which it is said to have been mailed. While it was still in the course of transmission through the mails, the property it insured was completely devastated by fire. The same fire destroyed farming tools of the admitted value of $445, insured by the second policy. At the time of the fire, the tools were contained in the buildings covered by the third or renewal policy.

The renewal policy, too, carries a rider. This rider differs from those attached to the first and second policies, in that it superadds a clause in these words:

"This company shall not be liable on any risk, for a greater amount than $3,000 on any policy or policies issued by this company, on any one set of buildings, or their contents. Meaning hereby to limit the total liability of this company to the aggregate sum of $3,000, whether one or more policies be issued, covering the same subject-matter."

It is the contention of the defendant, as a first proposition, that notwithstanding it issued to the plaintiff, and he paid for and relied upon, two different policies of insurance or indemnity, to the aggregate amount of $4,300, and regardless of his loss by fire to the extent of $3,445, both policies in force, of property covered by them, yet the rider provision of the renewal policy operates to restrict recovery to $3,000, the maximum of the particular policy to which it is attached. Expressed somewhat differently, to recovery of $445 for the burned farming tools, and of $2,555 for the dwelling house and other buildings ravaged in totality by fire, for the reason that the casualty consumed all the property together, and that it then comprised "one set of buildings and their contents," as well as the "same subject-matter," within the purpose of the rider on the renewal policy. Or, if not that, then the greatest possible liability under both policies, in view of the rider provision of the last, is $3,000.

The proposal to renew the first policy moved from the plaintiff, almost two weeks in advance of its expiration by limitation of time. He accompanied the offer by his promissory note in advance payment of the premium. What he said must be held to have been equivalent in significance to saying to the company:

"If agreeable to...